INSURANCE CODE
CHAPTER 544. PROHIBITED DISCRIMINATION
SUBCHAPTER A. GENERAL PROHIBITIONS AGAINST DISCRIMINATION BY AN
INSURER OR HEALTH MAINTENANCE ORGANIZATION
§ 544.001. APPLICABILITY OF SUBCHAPTER. This
subchapter applies to:
(1) any legal entity engaged in the business of
insurance in this state, including:
(A) a capital stock insurance company;
(B) a mutual insurance company;
(C) a title insurance company;
(D) a fraternal benefit society;
(E) a local mutual aid association;
(F) a statewide mutual assessment company;
(G) a county mutual insurance company;
(H) a Lloyd's plan;
(I) a reciprocal or interinsurance exchange;
(J) a stipulated premium company;
(K) a group hospital service corporation;
(L) a farm mutual insurance company;
(M) a risk retention group;
(N) an eligible surplus lines insurer; and
(O) an agent, broker, adjuster, or life and
health insurance counselor; and
(2) a health maintenance organization.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.002. UNFAIR DISCRIMINATION. (a) A person may
not refuse to insure or provide coverage to an individual, refuse to
continue to insure or provide coverage to an individual, limit the
amount, extent, or kind of coverage available for an individual, or
charge an individual a rate that is different from the rate charged
to other individuals for the same coverage because of the
individual's:
(1) race, color, religion, or national origin;
(2) age, gender, marital status, or geographic
location; or
(3) disability or partial disability.
(b) Subsection (a)(2) does not prohibit an insurer or health
maintenance organization from considering marital status in
defining persons eligible for dependent benefits.
(c) Subsection (a) does not prevent requirements to provide
title insurance coverage relating to possible community,
homestead, or other marital rights in land.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.003. EXCEPTIONS. (a) A person does not violate
Section 544.002 by providing coverage only to persons who are
required to obtain or maintain membership or qualification for
membership in a club, group, or organization to be eligible for
coverage if:
(1) the requirements are uniform requirements of the
insurer or health maintenance organization as a condition of
providing coverage and are applied uniformly throughout this state;
and
(2) the person does not engage in an act prohibited
under Section 544.002 against a qualified member, except as
provided by this section.
(b) A person does not violate Section 544.002(a)(2) or (3)
if the refusal, limitation, or charge is based on sound
underwriting or actuarial principles reasonably related to actual
or anticipated loss experience. For the purposes of this
subsection, a refusal, limitation, or charge relating to title
insurance is based on sound actuarial principles if the action is
based on an examination of title or on closing the transaction.
(c) A person does not violate Section 544.002 if the
refusal, limitation, or charge is required or authorized by law or a
regulatory mandate.
(d) A person does not violate Section 544.002 if
policyholders or enrollees with similar expense factors but
different loss exposures are charged different premiums or rates
under a mass marketing plan. The commissioner by rule shall define
selected groups eligible for issuance of policies or evidences of
coverage under a mass marketing plan.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.004. ENFORCEMENT ACTIONS. (a) A legal entity
engaged in the business of insurance or a health maintenance
organization, that is found to be in violation of or to have failed
to comply with this subchapter, is subject to the sanctions
provided by Chapter 82, including administrative penalties
authorized under Chapter 84.
(b) In addition to the procedures provided by Subsection
(a), the commissioner may use the cease and desist procedures
authorized by Chapter 83.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
SUBCHAPTER B. OTHER GENERAL PROHIBITIONS AGAINST DISCRIMINATION BY
INSURERS
§ 544.051. APPLICABILITY OF SUBCHAPTER. This
subchapter applies to any individual, corporation, association,
partnership, or other legal entity engaged in the business of
insurance, including:
(1) a fraternal benefit society;
(2) a county mutual insurance company;
(3) a Lloyd's plan;
(4) a reciprocal or interinsurance exchange;
(5) a farm mutual insurance company; and
(6) an agent, broker, adjuster, or life and health
insurance counselor.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.052. UNFAIR DISCRIMINATION. A person may not in
any manner engage in unfair discrimination or permit unfair
discrimination between individuals of the same class and of
essentially the same hazard, including unfair discrimination in:
(1) the amount of premium, policy fees, or rates
charged for a policy or contract of insurance;
(2) the benefits payable under a policy or contract of
insurance; or
(3) any of the terms or conditions of a policy or
contract of insurance.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.053. EXCEPTIONS. (a) A person does not violate
Section 544.052 if the refusal to insure or to continue to insure,
the limiting of the amount, extent, or kind of coverage, or the
charging of an individual a rate that is different from the rate
charged another individual for the same coverage is based on sound
actuarial principles.
(b) A person does not violate Section 544.052 by providing
insurance coverage only to persons who are required to obtain or
maintain membership or qualification for membership in a club,
group, or organization to be eligible for coverage if:
(1) the requirements are uniform requirements of the
insurer as a condition of providing insurance and are applied
uniformly throughout this state; and
(2) the person does not engage in an act prohibited
under Section 544.052 against a qualified member, except as
provided by this section.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.054. JUDICIAL ACTION; AWARD BY COURT. (a) A
person who has sustained economic damages as the result of a
violation of Section 544.052 may maintain only in a Travis County
district court an action against the person who violated that
section.
(b) An action under this section must be commenced before
the first anniversary of the date on which the plaintiff was denied
insurance or the unfair act occurred.
(c) A plaintiff who prevails in an action under this section
may obtain:
(1) the amount of economic damages, court costs, and
attorney's fees; and
(2) an order enjoining the violation.
(d) Court costs under Subsection (c) may include any
reasonable and necessary expert witness fees.
(e) If the trier of fact finds that the defendant knowingly
committed an act prohibited by Section 544.052, the court may award
a civil penalty in an amount of not more than $25,000 for each
claimant.
(f) The court shall award the defendant reasonable and
necessary attorney's fees if the court finds that an action under
this section was:
(1) groundless; and
(2) brought in bad faith or for the purpose of
harassment.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
SUBCHAPTER C. ENGLISH FLUENCY
§ 544.101. DEFINITIONS. In this subchapter:
(1) "Health benefit plan issuer" means an insurance
company, association, organization, group hospital service
corporation, or health maintenance organization that delivers or
issues for delivery an individual, group, blanket, or franchise
insurance policy or insurance agreement, a group hospital service
contract, or an evidence of coverage that provides health insurance
or health care benefits. The term includes:
(A) a life, health, and accident insurance
company operating under Chapter 841 or 982;
(B) a general casualty insurance company
operating under Chapter 861;
(C) a fraternal benefit society operating under
Chapter 885;
(D) a mutual life insurance company operating
under Chapter 882;
(E) a local mutual aid association operating
under Chapter 886;
(F) a statewide mutual assessment company
operating under Chapter 881;
(G) a mutual assessment company or mutual
assessment life, health, and accident association operating under
Chapter 887;
(H) a mutual insurance company operating under
Chapter 883 that writes coverage other than life insurance;
(I) a Lloyd's plan operating under Chapter 941;
(J) a reciprocal exchange operating under
Chapter 942; and
(K) a stipulated premium company operating under
Chapter 884.
(2) "Underwriting guideline" means a written,
electronic, or oral rule, standard, marketing decision, or practice
that is used by a health benefit plan issuer or an agent of a health
benefit plan issuer to examine, bind, accept, reject, renew or
refuse to renew, cancel, or limit coverages available to classes of
consumers or charge a different rate for the same coverage.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.102. APPLICABILITY OF SUBCHAPTER. This
subchapter applies to any health insurance policy, agreement,
contract, or evidence of coverage delivered or issued for delivery
by a health benefit plan issuer.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.103. PROHIBITION ON USE OF CERTAIN
GUIDELINES. (a) A health benefit plan issuer may not use an
underwriting guideline that is based on:
(1) the ability of an insured or enrollee or an
applicant for insurance coverage or health care benefits to speak
English fluently; or
(2) the literacy in English of the insured, enrollee,
or applicant.
(b) An applicant has the burden of proof to establish a
violation of this subchapter.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
SUBCHAPTER D. FAMILY VIOLENCE
§ 544.151. DEFINITION. In this subchapter, "family
violence" means an act between individuals who reside together or
resided together in which one individual:
(1) wilfully attempts to cause bodily injury, or
wilfully or wantonly causes bodily injury, to another;
(2) wilfully by physical threat places another in fear
of imminent bodily injury;
(3) engages in the act of sexual intercourse with a
minor under 16 years of age who is not the spouse of the individual;
or
(4) engages, with the intent to arouse or to satisfy
the sexual desires of the individual, a minor under 16 years of age
who is not the spouse of the individual, or both the individual and
the minor, in any lewd fondling or touching of the individual or the
minor.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.152. APPLICABILITY OF SUBCHAPTER. (a) This
subchapter applies only to:
(1) a life insurer that delivers, issues for delivery,
or renews a life insurance contract or policy in this state,
including a group contract, policy, or certificate of life
insurance; and
(2) a health benefit plan issuer that provides
benefits for medical or surgical expenses incurred as a result of a
health condition, accident, or sickness, including:
(A) an insurance company;
(B) a group hospital service corporation
operating under Chapter 842;
(C) a fraternal benefit society operating under
Chapter 885;
(D) a stipulated premium company operating under
Chapter 884;
(E) a health benefit plan issuer under Chapter
1501;
(F) a health maintenance organization operating
under Chapter 843;
(G) an employer under a multiple employer welfare
arrangement as defined by Section 3, Employee Retirement Income
Security Act of 1974 (29 U.S.C. Section 1002), or an analogous
benefit arrangement, to the extent permitted by the Employee
Retirement Income Security Act of 1974 (29 U.S.C. Section 1001 et
seq.);
(H) an issuer of a Medicare supplemental policy
as defined by Section 1882(g)(1), Social Security Act (42 U.S.C.
Section 1395ss); and
(I) an approved nonprofit health corporation
that holds a certificate of authority issued under Chapter 844.
(b) This subchapter does not apply to the issuer of:
(1) a health benefit plan that provides coverage:
(A) only for a specified disease;
(B) only for accidental death or dismemberment;
(C) for wages or payments in lieu of wages for a
period during which an employee is absent from work because of
sickness or injury;
(D) as a supplement to liability insurance;
(E) only for limited benefits; or
(F) only for dental or vision care;
(2) hospital confinement indemnity coverage;
(3) a credit insurance policy;
(4) workers' compensation insurance coverage;
(5) medical payment insurance coverage provided under
a motor vehicle insurance policy; or
(6) a long-term care policy, including a nursing home
fixed indemnity policy, unless the commissioner determines that the
policy provides benefit coverage so comprehensive that the policy
is a health benefit plan as described by Subsection (a)(2).
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.153. PROHIBITIONS. (a) A health benefit plan
issuer or life insurer may not, because of an individual's status as
a victim of family violence:
(1) deny coverage to the individual;
(2) refuse to renew the individual's coverage;
(3) cancel the individual's coverage;
(4) limit the amount, extent, or kind of coverage
available to the individual; or
(5) charge the individual or a group to which the
individual belongs a rate that is different from the rate charged to
other individuals or groups, respectively, for the same coverage.
(b) A health benefit plan issuer or life insurer may not, as
a part of an application for coverage, require an applicant to
reveal whether the applicant has been or may become a victim of
family violence.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.154. CONFIDENTIALITY OF CERTAIN
INFORMATION. (a) Except as provided by Subsection (b), a health
benefit plan issuer, life insurer, or person employed by or under
contract with a health benefit plan issuer or life insurer may not
release information relating to the status as a victim of family
violence of an individual who is clearly a victim of family
violence, including:
(1) information about specific acts of family violence
directed at the individual;
(2) the individual's address or telephone number at
home or at work; and
(3) information about the individual's employment,
associations, family membership, or relationships.
(b) A health benefit plan issuer or life insurer may release
information to which Subsection (a) applies only:
(1) to the individual;
(2) to another individual designated in writing by the
individual;
(3) to a licensed physician designated by the
individual;
(4) to a physician or other health care provider for
the provision of health care services;
(5) to an attorney who needs the information to
effectively represent the issuer or insurer, if the issuer or
insurer notifies the attorney of the requirements of this
subchapter and requests that the attorney exercise due diligence to
protect the information consistent with the attorney's obligation
to represent the issuer or insurer;
(6) to an individual covered under, or the owner of,
the health benefit plan or life insurance contract or policy that
contains information about status as a victim of family violence;
(7) to an individual or entity to whom the
commissioner considers the release appropriate;
(8) as required by other law or an order of the
commissioner or a court; or
(9) as necessary for a valid business purpose if:
(A) the information cannot be segregated from
other information about the individual without undue hardship to
the issuer or insurer;
(B) the recipient of the information is:
(i) a reinsurer that seeks to indemnify or
indemnifies all or part of a health benefit plan or life insurance
contract or policy covering the individual if the reinsurer cannot
underwrite or satisfy obligations under the reinsurance agreement
without the release of the information;
(ii) a party to a proposed or consummated
sale, transfer, merger, or consolidation of all or part of the
business of the issuer or insurer;
(iii) medical or claims personnel under
contract with the issuer or insurer, including a parent or
affiliate company under a service agreement with the issuer or
insurer, if the release of the information is necessary to process
an application, to perform duties under the health benefit plan or
life insurance contract or policy, or to protect the safety or
privacy of a victim of family violence; or
(iv) an entity with which the issuer
transacts business if the information is only the address or
telephone number of the individual and the entity cannot transact
the business without the address or telephone number; and
(C) the recipient of the information agrees in
writing to be subject to the requirements of this subchapter.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.155. UNDERWRITING CRITERIA. Notwithstanding any
other provision of this subchapter, a health benefit plan issuer or
life insurer may underwrite a risk on the basis of an individual's
physical or mental condition regardless of the underlying cause of
the condition or on the basis of any underwriting criteria not
prohibited by this code or another insurance law of this state or a
rule adopted under this code or another insurance law of this state
if the issuer or insurer consistently applies the criteria and does
not merely use the criteria as a pretext to evade the application of
Section 544.153.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.156. HEALTH BENEFIT PLAN ISSUER OR LIFE INSURER
NOT LIABLE FOR DEATH OR BODILY INJURY. A health benefit plan
issuer or life insurer that delivers, issues for delivery, or
renews a health benefit plan or a life insurance policy or contract
for an individual who has been or may become a victim of family
violence may not be held civilly or criminally liable for the death
of or bodily injuries incurred by that individual as a result of
family violence.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.157. RIGHT TO CONTINUED COVERAGE
UNAFFECTED. This subchapter does not affect the right of an
individual to continued coverage under Subchapter G, Chapter 1251.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.158. UNFAIR OR DECEPTIVE ACT OR PRACTICE. A
violation of this subchapter is an unfair or deceptive act or
practice under Chapter 541.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
SUBCHAPTER E. FIBROCYSTIC BREAST CONDITION
§ 544.201. DEFINITION. In this subchapter, "health
benefit plan issuer" means an insurer, a group hospital service
corporation operating under Chapter 842, or a health maintenance
organization operating under Chapter 843 that delivers or issues
for delivery or renews any health insurance policy or contract in
this state, including a group policy, contract, or certificate of
health insurance or evidence of coverage.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.202. PROHIBITION. A health benefit plan issuer
may not, solely or in part because an individual has been diagnosed
with or has a history of a fibrocystic breast condition:
(1) deny coverage to the individual;
(2) refuse to renew the individual's coverage;
(3) cancel the individual's coverage;
(4) limit the amount, extent, or kind of coverage
available to the individual for any other breast condition; or
(5) charge the individual or a group to which the
individual belongs a rate that is different from the rate charged to
other individuals or groups, respectively, for the same coverage.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.203. UNFAIR OR DECEPTIVE ACT OR PRACTICE. A
violation of this subchapter is an unfair or deceptive act or
practice under Chapter 541.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.204. PAYMENT FOR DISEASE NOT REQUIRED. This
subchapter does not require a health benefit plan issuer to pay
benefits for fibrocystic breast disease.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
SUBCHAPTER F. CHURCH PROPERTY
§ 544.251. DEFINITIONS. In this subchapter:
(1) "Church" means a facility that is owned by a
religious organization and is used primarily for religious
services.
(2) "Religious organization" means a church,
synagogue, or other organization or association organized
primarily for religious purposes.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.252. APPLICABILITY OF SUBCHAPTER. This
subchapter applies to an insurer that is admitted to engage in the
business of insurance and authorized to write an insurance policy
providing coverage for losses resulting from fire in this state,
including a county mutual insurance company, a Lloyd's plan, a
reciprocal or interinsurance exchange, or a farm mutual insurance
company.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.253. PROHIBITION. An insurer writing insurance
for a church may not cancel or decline to renew an insurance policy
solely because of:
(1) an occurrence of arson against the church, if the
religious organization that owns the church cooperated with police,
fire, and other authorities in the investigation of the arson and in
the prosecution of those responsible for the arson; or
(2) a verbal or written threat of arson against the
church that was directed to the religious organization or an
official of the religious organization and that the organization or
official reported to the appropriate law enforcement agency within
a reasonable amount of time.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
§ 544.254. UNFAIR OR DECEPTIVE ACT OR PRACTICE. A
violation of this subchapter is an unfair or deceptive act or
practice in the business of insurance under Chapter 541.
Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.
